Home prices down year over year, breaking record 131-month streak of increases

Existing
home prices decreased from February 2022 to last month, marking the end of an 11-year streak of increases.

The National Association of Realtors reported that the median existing-home price for all housing types was $363,000, a decline of 0.2% from February 2022. This drop is the longest recorded streak of housing price growth that has come to an end.

The cause of the decrease is the rising interest rates of the Federal Reserve, which led to an increase in mortgage rates, decreasing demand for homes and lowering prices.

After months of declines, existing-home sales rose in February by 14.5% to a seasonally adjusted annual rate of 4.58 million. Though total housing inventory rose 15.3% from the previous year, inventory levels are still historically low, and multiple offers are returning on a good number of properties, according to NAR Chief Economist Lawrence Yun.

Additionally, homes typically remained on the market for 34 days in February, indicating a sputtering housing market. A housing report by Redfin showed the first annual decline since 2012 last week.

Goldman Sachs predicted that housing prices in some overheated markets, like Austin and Phoenix, will fall by more than 10% this year, with San Diego and San Francisco home prices dropping more than 10% and continuing to fall in 2024.